Kenya Orders Three C-27J Transports and AW139 Helicopters from Leonardo

(Source: Defense-Aerospace.com; posted July 03, 2018)

Italy’s Leonardo has sold three Alenia C-27J Spartan airlifters and a number of AgustaWestland AW139 helicopters to Kenya, in a deal worth about 220 million euros. The company expects more C-27J sales in the short-term. (Leonardo photo)

PARIS --- Italy’s Leonardo has signed contracts to deliver three Alenia C-27J Spartan and un undisclosed number of Agusta Westland AW139 helicopters to Kenya, according to Italian and Kenyan press reports.

Kenyan Treasury Secretary Henry Rotich told the Kenyan Parliament’s Public Accounts committee on June 26 that the government had taken two loans to pay for the new aircraft: one for KSh20 billion (worth approx. $198,5 million) to pay for the C-27Js, and a second one further KSh6 billion (approx. €51.8 million) to pay for the helicopters.

This will translate into gross revenues of about €222 million for Leonardo, which will be particularly welcome in this dry stretch that company has experienced in recent months.

Both loans were extended by UniCredit Spa bank of Milan, Italy, and were signed on December 11, 2017. They will be repaid starting on June 11, 2019 and will mature a decade later, on June 11, 2029.

A Leonardo spokesman on Tuesday declined to confirm the deal, simply saying that the company had good prospects for C-27J sales.

Other sources however confirmed the deal, one adding that Kenya’s C-27Js will be the first to be equipped with a new avionics suite. (Contrary to what was originally stated, Kenya's C-27Js will not be fitted with winglets--Ed.) Kenya’s Spartans will be delivered beginning in 2019.

The new C-27J baseline configuration will have the new avionics system, allowing full compliance with new civil aviation regulations (ATC) and military requirements (IFF), as well as other modifications intended to make the aircraft more efficient and less costly to operate.

The new configuration will be tested and qualified in 2018, and will be available in 2019 without a significant change in price.

The aircraft has been ordered by the Air Forces of Italy, Greece, Bulgaria, Lithuania, Romania, Morocco, the U.S. Coast Guard, Mexico, Australia, Chad, Peru, Slovakia and now Kenya, for a total of 85 aircraft on order.

Leonardo officials believe the C-27J has the potential to achieve more orders in the short-to-medium term, both for the baseline C-27J and for the armed multi-mission MC-27J in Turkey, Chile, Bolivia, Argentina and New Zealand, as well as in several African countries, all of whom require good “hot-and-high” performance.

Another source confirmed that the undisclosed customer which ordered two C-27Js is Zambia.

We have not been able to determine the number of AW139 helicopters covered by this order, but a previous order which was delivered in June -- for the Kenyan Police -- comprised four helicopters, and this could well be the case this time, as the price is coherent for such a number.

Sources also note that Pakistan also recently announced it would order additional AW139, which would further improve the company’s order book.

Meanwhile, Italian analysts believe Leonardo's revenues could grow by 5% this year, or €386 million, thanks to higher deliveries than in 2017, and in particular to the delivery, by the end of the year, of some significant export contracts.

Milan-based investment bank Mediobanca expects revenues of €11.913 billion euros for 2018, compared to €11.527 billion in 2017, and a net profit of €392 million euros (up from €272 million in 2017).

Story history:
-- July 4, 2018:
* corrected text to reflect that Kenya's C-27Js will not be fitted with winglets;
* corrected the total number of C-27Js ordered to 85 (and not 83)